Bank of Baroda moves to reshape its capital structure

Capital Position & Regulatory Buffer Alignment

Bank of Baroda’s consolidated Common Equity Tier 1 (CET1) ratio stands at 13.0% as of Q3 FY26 ^[1], while its standalone Capital Adequacy Ratio (CAR) is 12.4% as of Q3 FY26 ^[2] (consolidated CAR was last reported at 14.7% in Q2 FY26 ^[3]).

The specific board-approved quantums for AT1 (Additional Tier 1) and Tier II bond issuances, alongside management’s quantitative internal credit growth target guidance, are not disclosed in the reported financial statements. However, actual loan expansion accelerated to 16.4% YoY on a consolidated basis in Q4 FY26 ^[4] (and 16.5% YoY standalone ^[5]), demonstrating strong loan book expansion against reported capital levels.

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Capital & Credit Growth Tracking Table

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Credit Growth vs. Capital Consumption & Regulatory Buffers

• Regulatory Cushion: Under RBI Basel III regulations, banks are required to maintain a minimum Total CAR of 11.50% (inclusive of a 2.50% Capital Conservation Buffer / CCB) and a minimum CET1 ratio of 8.00% (inclusive of CCB). The bank's Q3 FY26 consolidated CET1 ratio of 13.0% ^[1] provides a ~500 bps buffer above minimum regulatory thresholds.
• Standalone Capital Trajectory: On a standalone basis, CAR compressed by 100 bps quarter-on-quarter, moving from 13.4% in Q2 FY26 ^[2] to 12.4% in Q3 FY26 ^[2]. This reflects active Risk-Weighted Asset (RWA) consumption driven by strong portfolio expansion.
• Credit Acceleration: Consolidated loan growth stepped up from 12.3% YoY in Q2 FY26 ^[4] to 16.4% YoY in Q4 FY26 ^[4], with total advances reaching Rs 1,440,458.3 Crores ^[7]. The double-digit loan expansion rate underscores why non-dilutive subordinated capital (AT1 and Tier II) is typically deployed to protect equity capital and maintain comfortable headroom over regulatory baselines.

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Disclosure Limits

• Approved AT1 / Tier II Quantums: The explicit approved borrowing limits, issuance schedules, and coupon/pricing structures for AT1 and Tier II debt instruments were not reported in the available context.
• Tier-1 Position Breakdown: Beyond the reported CET1 ratios (13.0% consolidated in Q3 FY26 ^[1] and 14.1% standalone in Q1 FY26 ^[6]), the explicit split between CET1 and AT1 capital within the aggregate Tier-1 ratio was not disclosed for Q3 FY26 or Q4 FY26.
• Internal Target Guidance: Management's specific internal annual credit growth targets and formal capital utilization frameworks were not disclosed in the reported financial outputs.

The Capital Raising Committee of Bank of Baroda has authorized an aggregate capital raising limit of up to Rs 6,000 Crores through the issuance of Additional Tier 1 (AT1) and/or Tier II bonds ^[9].

• Aggregate Limit: Up to Rs 6,000 Crores, originally cleared by the Board of Directors on May 8, 2026, and subsequently approved by the Capital Raising Committee on August 7, 2026 ^[9].
• Instrument Types: Additional Tier 1 (AT1) and/or Tier II bonds ^[9].
• Timeline and Execution: Planned in suitable tranches through March 31, 2027, with provisions to continue issuances beyond that date if found expedient ^[9].

Bank of Baroda has not separately reported the size of any proposed AT1 or Tier II debt issuance, nor are its existing outstanding AT1 and Tier II debt portfolios and historical coupon rates disclosed in public financial reports. Comparative coupon rate trends and debt portfolio breakdowns for peer public sector banks (Union Bank of India, Punjab National Bank, Canara Bank, Indian Bank, and Bank of India) are likewise not reported in available financial disclosures.

To anchor the scale of the institutions, standalone total asset bases as of Q4 FY26 were as follows:

• Bank of Baroda: Rs 2,009,163.8 Crores ^[10]
• Punjab National Bank: Rs 1,985,892.5 Crores ^[11]
• Canara Bank: Rs 1,883,201.9 Crores ^[12]
• Union Bank of India: Rs 1,569,354.6 Crores ^[13]
• Bank of India: Rs 1,163,432.8 Crores ^[14]
• Indian Bank: Rs 987,952.8 Crores ^[15]

Specific capital-instrument issuance terms, tier-wise debt portfolio compositions, and historical coupon trends remain undisclosed disclosure gaps across all referenced entities.